Worldbuilding - refurbishing old worlds

Going to lean toward the geeky a little... well okay, more than a little.

Our current RPG is fast approaching its climactic conclusion, and everyone's already started probing me for what my plans are when I take up the mantle of GM again.  It's been fun to be a player again for a while, but I've been itching to become the orchestrator once more.  I was thinking of something a little more steampunk themed for a change, so I've been doing some research.

I keep kicking around the question of how far science has progressed and what's possible.  The real problem is that we all think in terms of modern day science.  Single-shot pistols that take a minute or more to reload aren't too much worse than crossbows, but it would only be a matter of time before someone asks about finding an engineer to design something self-contained and bullet-like.  Then comes the inevitable argument over why they can't suggest something like that.  It's only the next logical step, after all.  Well of course it seems that way to us, since we've already taken it.

It's because of that specific premonition I've already decided that gunpowder has not been invented and never will be.  But variations on the same problem keep appearing as I try to map out this new world.  What do I say when one of the players says she wants to create a telephone from a telegraph?  I could just say it doesn't work, but she'll only try again and become upset if it doesn't work eventually, since we both know it's entirely possible to do with the technology of the era.  I finally realized that the root of the problem was that both she and I would be picturing scientific advancement as a point on a single path leading straight to where we are now.  The applications might turn out a little different, but when science advanced there was really only one direction it could possibly go.

I started looking into some of the defunct theories proposed back in the seventeenth and eighteenth centuries and found a goldmine of possibilities.  Concepts like the aether, caloric, and the od.  They may have since been proven incorrect, but they weren't just wild ideas cooked up by irresponsible theorists trying to explain what they didn't understand while the real scientists were in the lab discovering the true nature of the universe.  These theories were widely accepted by the scientific community.  Numerous experiments were conducted and papers written by respected scientists in attempts to explore the nature of these 'imponderables'.

Who's to say that those theories weren't actually true in my world?  They were explanations for the universe as they understood it.  The current level of technology was fully within the possibilities suggested.  Sending an electric current through a wire was pictured as being the same as pouring water down a tube.  You could switch the flow on and off to send simple messages, but it would be impossible to modulate it with magnets in order to transmit sound.  Other possibilities are suggested though.  Would wires made from other materials be able to quickly channel heat or light (also visualized as intangible liquids) to distant locations just as quickly?  I think I'm really on to something now.